Lean Warehousing Driving Supply Chain Effectiveness by Leaning

Lean Warehousing Driving Supply Chain Effectiveness by Leaning Your Warehouse Chris Barnes – Consultant, Product Support Services, QAD

Lean Warehousing Safe Harbor Statement The following is intended to outline QAD’s general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, functional capabilities, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functional capabilities described for QAD’s products remains at the sole discretion of QAD. 2

Lean Warehousing Objectives • Best practices you can implement today • Understand advance strategies with QAD Warehousing • Cover 50 lean warehousing practices 3

Lean Warehousing Tell Me About You… • • Do you have a warehouse Any lean initiatives in the warehouse Do you use WMS What would you like to get from this session 4

Lean Warehousing Defined • A building, or a part of one, for the storage of goods or merchandise • To some in the JIT world, warehousing is considered a waste 5

Lean Warehousing “Top Pressures” Driving Lean Warehousing • • • 45% do more with less 35% increased demand / supply fluctuations 31% better utilization of resources 39% rising operating costs 28% customer turn time requests Source: Aberdeen Group - Warehouse Management Excellence, Maximizing Resources & Efficiency, Nov 2010 6

Lean Warehousing “Top Actions” to Improve Warehouse Management • 54% Better systems integration • 39% Improve labor efficiency by reassessing software and warehouse resources • 39% Increase visibility into inventory and order status • 36% Improve throughput through systems or automation • 32% Realign / consolidate products across our facilities • 21% Improve perfect order rate by improving pick accuracy and on-time shipment Source: Aberdeen Group - Warehouse Management Excellence, Maximizing Resources & Efficiency, Nov 2010 7

Lean Warehousing Principles • • • Flexibility Lead time reduction Risk reduction Reduce variation Business plans as guidelines Source: Aberdeen Group - Warehouse Management Excellence, Maximizing Resources & Efficiency, Nov 2010 8

Lean Warehousing 50 Ways to Lean Your Warehouse 1. 2. 3. 4. 5. 6. 7. Get organized Marked aisles & areas Look at lighting Straight flows Slotting strategy Minimize travel Flexible picking strategies Source: Aberdeen Group - Warehouse Management Excellence, Maximizing Resources & Efficiency, Nov 2010 9

Lean Warehousing QAD Warehousing Flexible Picking • • • Discrete Batch Cluster Zone Pick & pass 10

Lean Warehousing 50 Ways to Lean Your Warehouse 8. 9. 10. 11. 12. 13. 14. Establish appropriate pick locations Use voice pick where appropriate Measure warehouse performance Share performance information Business intelligence Use RF data collection Leverage alerts & messaging 11

Lean Warehousing RF Task Management and inquiries save time and provide real-time information updates. 12

Lean Warehousing Alerts and Instant Messaging 13

Lean Warehousing RF Messaging 14

Lean Warehousing 50 Ways to Lean Your Warehouse 15. 16. 17. 18. 19. 20. 21. 22. 23. Wave management Ensure inventory positions Focus on inventory accuracy Use cycle counting Get rid of excess inventory Get rid of space wasters Store obsolete materials off-site Improve cube utilization Vary storage location sizes 15

Lean Warehousing Cube Utilization Vertical Honeycombing wasted space improved beam spacing 16

Lean Warehousing 50 Ways to Lean Your Warehouse 24. 25. 26. 27. 28. Know your order profile Store loads according to size Space allocation by planned inventory levels Use reserve storage and forward pick Implement random storage 17

Lean Warehousing Reserve Storage / Forward Pick • Reserve = Random Unit 4 Unit 1 Reserve Loc Unit 2 Unit 3 Reserve Loc • Forward Pick = Dedicated 040 -BX-001 040 -EA-001 18

Lean Warehousing 50 Ways to Lean Your Warehouse 29. 30. 31. 32. 33. 34. 35. 36. Consider fluid loading Use the correct equipment Consider planned & opportunistic cross docking Leverage advanced shipment notice (ASN) Minimize packaging Store receipts without checking or repacking Run a scheduled dock Replace checking with auditing 19

Lean Warehousing 50 Ways to Lean Your Warehouse 37. 38. 39. 40. 41. 42. 43. 44. Quality sampling and auditing available on receipt Measure to improve labor performance Cross train Identify your superstars Use standard operating procedures Perform layout assessment Minimize aisle widths Optimize staging areas 20

Lean Warehousing 50 Ways to Lean Your Warehouse 45. Store in aisles 46. Standardize pallet sizes 47. Standardize unit loads 48. Storage racks over dock doors 49. Case flow racks in pallet racks 50. Interleave work tasks bonus 50 ½. Leverage a solid WMS 21

Lean Warehousing QAD WMS is Fully Integrated into QAD Apps Task Management QAD Apps Yard & Dock Management Productivity Tracking Receiving Inventory Lot, S/N, Exp VAS Wave Planning Cross Docking Shipping / Manifesting Put-Away Optimized Picking Slotting Replenishment 22

SSM SCP WMS BIBI Green Financials Purchasing Transportation MSW/ /PSW MSW White Configurator Black DM DM EAM Field Readiness Lean Warehousing Value Chain Certification Belt Value Chain Certification 23

Lean Warehousing Core Principles of Lean Warehousing • • Visible customer consumption Reduce lead time Pull system Reduce variation Create velocity Focus on process discipline Total cost of fulfillment 24

Lean Warehousing Metrics Affected Process Benefit Value • Reduced labor cost • -20 to 30% • Improved fill rate • +10 to 40 pts • Reduced Inventory level • -10 to 30% • Improved Inventory accuracy • To 99. 9% • Less warehouse space • -20 to 50% Receiving • Labor reduction • -20 to 30% Real Time Put Away, Product Slotting • Labor reduction • -20 to 30% • Inventory accuracy improved • To 99. 9% Mobile Device Based Order Fulfillment • Labor reduction • -20 to 30% Bin Level Location Mgt 25

Lean Warehousing Next Steps • Ask your account manager for a Lean Warehousing Q−Scan 26

Lean Warehousing Questions & Answers Chris Barnes: c 9 b@qad. com 27